Container heavyweights to cooperate in transpacific

The world's three largest container-shipping lines -- Maersk Line, Mediterranean Shipping Co., and CMA CGM -- have opted to join forces in the struggling Far East/U.S. West Coast trade and try to reduce operating costs by introducing larger ships on new joint services.

Under terms of the vessel sharing agreement announced today, the three European boxship giants will cooperate on three weekly services that will include two loops both using five 8,000-TEU vessels.

"Given the rising cost of bunker fuel and the distances traveled, a post-Panamax
level of efficiency and cost base is needed in the transpacific," said Robert Kledal, Maersk's vice president of route management. "The 8,000-TEU vessels on the two largest loops of this new network make this an efficient, cost-effective and environmentally friendly solution for our customers shipping needs.

"This new agreement will maintain capacity in this trade, reduce environmental impact and will demonstrate significant other advantages to both the shippers and consumers. With a schedule built around efficient speed, this VSA will minimize the impact of fuel cost increases on the Pacific trade."

The three new services will replace four existing loops, namely Maersk's TP5 and TP8, MSC's New Orient Express and CMA CGM's joint Yang Tse/AAC2 service with China Shipping Container Lines, who will not participate in the new structure.

According to ComPair Data (www.compairdata.com), American Shipper's affiliated database for global liner services, the four services exiting the trade between them contributed some 17,750 TEUs in weekly one-way capacity.

"Rates have not supported our cost to serve on different products in the Pacific," said Vincent Clerc, vice president of Pacific route management for Maersk Line. "We felt that a partnership of this sort would not only enable us to address our cost structure, but also to provide a dynamic enhanced product for our customers, without adding any capacity on the market."

The first string of the VSA will use five 8,000-TEU vessels, four from Maersk and one from CMA CGM, on a rotation of Hong Kong, Yantian, Kaohsiung, Shanghai, Qingdao, Los Angeles and back to Hong Kong. The first westbound call will be made from Los Angeles on April 29.

The second loop will use another five ships of the same capacities, four coming from MSC and one from CMA CGM, on a rotation of Dalian, Tianjin, Xingang, Shanghai, Ningbo, Long Beach, Oakland and Dalian. The first westbound call is in Long Beach on April 27.

"The development of the two new services comes as a replacement of existing capacity in the trade," said Jean-Philippe Thenoz, CMA CGM's vice president, North America lines. "This rationalization of our service will strengthen our China coverage and responds nicely to customer needs for increased presence in North China."

A third string, on which CMA CGM and MSC will only take slots, will be created with the reworking of Maersk's former TP5 loop so that five U.S.-flag, 4,000-TEU vessels will operate on a rotation of Kwangyang, Busan, Kobe, Shimizu, Nagoya, Yokohama, Los Angeles and Oakland. The revamped service will kick off from Los Angeles on March 25.